UK dodges recession with surprise 0.2% September growth

investmentweek.co.uk:

September’s growth was driven by a 0.2% expansion in services output, largely from professional, scientific and technical activities, as well as human health and social work activities.

The Office for National Statistics said today (10 November), that September's growth was driven by a 0.2% expansion in services output, largely from professional, scientific and technical activities, as well as human health and social work activities.

Meanwhile, the construction sector saw a turnaround, increasing by 0.4% in September 2023 after a fall of 0.8% in August.

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Michael Field, Europe market strategist at Morningstar, said: «Manufacturing usually takes the rap for slow economic growth in the UK, and rightfully too in many ways. Manufacturing activity, shown by manufacturing PMIs, has been in decline since the middle of 2022.

»With manufacturing contributing less than 20% to GDP however, this is just part of the problem."

He explained that the service industry contributes to almost 80% of GDP, leaving the economy reliant on it, which has been harmful given a «large pullback in spending over the last 18 months».

«With interest rates likely to stay high for an extended period of time, it is hard to see any quick reversal on service spending, meaning low GDP growth may persist for some time yet,» he said.

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Emma Mogford, fund manager of the Premier Miton Monthly Income fund, said that while a flat economy was not «usually something to cheer about», it represented a «decent outcome» given the pressures from the cost-of-living crisis and higher interest rates.

«While pressures from